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FOCUS PSI Journal 5/2016 www.psi-network.de
CHINA AFTER THE GROWTH BOOM
PROFITING FROM CHANGE
With a growth rate of 6.9 per cent, 2015 marked a turnaround in the Chinese economy:
The dark side of the industrial revolution is visible in all sectors and is inhibiting momentum.
China seems to have arrived in the „new normality“. Together with 12 promotional product
companies, we explore how the economic conditions in China have changed and how these
processes impact production and imports.
China: The growth engine is stuttering“
was the headline of the Handelsblatt
mid-January. A month later, the FAZ carried
the title „China‘s foreign trade is shrinking.“
These two main trends describe
China‘s economy. More recent headlines
are also causing people to sit up and take
notice: In March, for instance, Spiegel online
ran the story „China allegedly dismisses
five million workers“. What has happened
in the world’s second largest eco-
nomy (after the US)? It has grown slower
than at any time in the past 25 years: The
rate of growth in 2015 was just under 7
per cent, a decline from previous doubledigit
levels. Compared with the same period
last year, exports fell in January 2016
by 6.6 per cent, imports by as much as
14.4 per cent. The structural change is
hampering the economy; added to that are
a shortage of skilled labour, rising wages
and a shortage of capital. The industry is
suffering, and the stock markets are tottering.
GROWTH IS UNSUSTAINABLE
It is rightly argued that in international
terms China is still in a very good position
with its current economic growth of 6.9
per cent. By comparison, the German economy
grew by 1.7 per cent in 2015, meaning
Germany fell back to an average level
in a European context. This is a solid and
steady growth, however, as is often read-